Doing Business with Finland
|Religion||Evangelical Lutheran (68%), Greek Orthodox (1%)|
|State system||parliamentary republic|
|Head of State||Sauli Niinistö|
|Head of government||Sanna Marin|
|Currency name||Euro (EUR)|
|Time shift||+ 1 hour|
|Nominal GDP (billion USD)||294.3|
|Economic growth (%)||3.5|
Finland is a parliamentary democracy, where the executive power is concentrated in the hands of the government, the president has a significant role only in foreign policy. The current government has been headed by Prime Minister Sanna Marin since the end of 2019, and Sauli Niinistö has been president for the second time since March 2018. Broad coalitions across the political spectrum are traditionally established in the unicameral parliament. The political process is characterized by an effort to reach a consensus, especially on basic security issues, as well as maximum transparency towards the public, which stands behind general trust in institutions and in politics as such.
Finland belongs to the internal market of the EU and ranks among the highly developed, industrialized and innovative economies with a free market. With its economic performance, Finland ranks among the top in the world. Key economic sectors are telecommunications, electronics, industrial production (wood and metal processing) and engineering. A strong orientation towards innovation, green technological transformation and digitization is essential. Finland must continue to face pressure on the sustainability of public finances, especially as a result of unfavorable demographic developments, and deal with some already chronic problems such as long-term low growth potential, low labor productivity, structural unemployment, insufficient investment, inefficient labor market, etc. It is under pressure also an export-oriented industry that faces both international competition and high wage levels.
The Finnish economy has withstood the coronavirus pandemic relatively well, mainly thanks to minimal trade restrictions, the massive digitization of society, a specific system of temporary layoffs, and less dependence on tourism. In 2020, there was a relatively small decline in GDP (-2.3%) and in 2021, according to the latest estimates, there was an increase of 3.5%. GDP in 2022 and in the following years is likely to be significantly affected by the conflict in Ukraine, as a result of which growth is expected to slow down to 0.5-2%. Pro-growth factors will be private consumption as well as public and private investment, especially in the area of green transformation, infrastructure and innovation.
Transparency, objectivity, structure, reliability and punctuality are very important in business negotiations. Czech entrepreneurs can sometimes be surprised by their Finnish partners’ directness, informality, relaxation, sense of humor, not showing off their social and financial status, or the consistent effort to find a balance between private and work life.
The Czech Republic has a fairly significant positive trade balance with Finland (exports are almost twice as large as imports). The largest item of Czech exports to Finland, and also the driver of the favorable balance, are motor vehicles. Mechanical machines and devices (including electronic ones) are traded the most. Another dominant export commodity of the Czech Republic is iron and steel products; Finland’s similarly successful commodity in the Czech Republic is paper and cardboard.
Prospective fields for Czech exports are energy, ICT, defense, construction, healthcare and pharmaceutical industries, and railway and rail transport. However, in addition to the mentioned sectors, opportunities need to be sought in a number of other fields, where there is a strong demand for innovative products and solutions with high added value in Finland (e.g. circular economy, recycling, disposal and upcycling of waste, innovative processing and use of wood, etc.).
Practical telephone numbers (emergency services, police, firemen, information lines, etc.)
- Central emergency telephone number (ambulance, fire brigade, police): 112
- Assistance at sea: 0294 1000
- Help for Victims of Crime: 0203 16116
- Crisis line: 09 2525 0111
Important web links and contacts
Government and President:
- Government Office
- Ministry of Labor and Economy
- Ministry of Finance
- Ministry of Transport and Communications
- Ministry of Health and Social Affairs
- Ministry of Education and Culture
- Department of Justice
- Ministry of Foreign Affairs
- Ministry of Interior
- Ministry of Agriculture and Forestry
- Ministry of the Environment
- Ministry of Defense
Chambers of Commerce:
- Central Chamber of Commerce
- Central Finland Chamber of Commerce
- Helsinki Region Chamber of Commerce
- Häme Chamber of Commerce
- Kuopio Chamber of Commerce
- Kymenlaakso Chamber of Commerce
- Lapland Chamber of Commerce
- North Karelia Chamber of Commerce
- South Karelia Chamber of Commerce
- Ostrobothnia Chamber of Commerce
- Oulu Chamber of Commerce
- South Ostrobothnia Chamber of Commerce
- Rauma Chamber of Commerce
- Riihimäki-Hyvinkää Chamber of Commerce
- Satakunta Chamber of Commerce
- South Savo Chamber of Commerce
- Tampere Chamber of Commerce
- Turku Chamber of Commerce
- Western Newland Chamber of Commerce
- Åland Chamber of Commerce
- National Bank
- Business Finland
- Statistical Office
- Economic Research Institute
- Tax administration
- Confederation of Finnish Industry
- Helsingin Sanomat
- Maaseudun Tulevaisus
PaulSourcing: Ten Commandments for Doing Business with Finland
The PaulSourcing agency has prepared ten recommendations for doing business with Finland for Czech entrepreneurs interested in business relations with Finland. In 2020, it was supplemented with 4 current tips.
4 recommendations for entering the Finnish market during the coronavirus pandemic situation:
- Search for business partners You can operate on the Finnish market independently or through business partners or distributors. But having a business partner in Finland is a big advantage, not only from the point of view of the distance of the country, but also cultural and language differences.Finding business partners or opportunities in Finland is not easy. Many websites also have an English version, but on the other hand, there is no comprehensive database of contacts where they can be easily found. The help of PaulSourcing’s foreign office in Stockholm (ZK Stockholm) can therefore be beneficial in this step – it has an overview of the market, experience in searching and, in addition to Google and LinkedIn, it also has its own database of contacts, accumulated over the years of the office’s existence.
- Choosing a partner Choosing a business partner is important. After compiling a list of maximum possible contacts, it is good to ask yourself the question: who is the right partner for me? The best thing to do is to draw on experience from your other export markets. In general, it can be said that what works in other Western European countries can also work in Finland. If experience from other European countries is lacking, it is good to focus on medium and small businesses. Large companies in Finland have high demands both on the quality of goods or services and on references.
- Choosing a business strategy An exclusive partner for the whole of Finland, or more representatives for individual regions? Both can work. Although Finland is a vast country, trade is concentrated in a few densely populated areas. If you decide on an exclusive partner, it pays to conclude the first contract for a year and condition the exclusivity on a jointly determined volume of business in the first year. However, expect an investment in the development of activities and also a lower price compared to the competition, especially in the first year of business. The local market is demanding and it is difficult to stand out against tough local and foreign competition. Share these costs with your Finnish business partner, but at the same time don’t forget to motivate him with favorable margins.
- Support of the PaulSourcing foreign office The PaulSourcing office for Scandinavia is based in Stockholm. Therefore, it is not permanently present in Norway and cannot be your extended arm while you build your business in this country. However, her credo is not to provide you with a list of companies and not to take care of you anymore, but if you decide to try your luck in the Norwegian market, you can contact her at any time. ZK Stockholm also closely cooperates with the commercial section of the embassy in Finland.
Ten points for doing business with Finland
- Listen to your business partners Finland is a unique country within Europe and Scandinavia. Finns are based on their traditions, show respect to your partners and listen to them well.
- Schedule meetings at a convenient time Meetings in Finland are not scheduled between nine in the morning and four in the afternoon and the agreed duration is kept. Leisure and work are separate.
- Be serious during negotiations In Finland, people first introduce themselves formally, they only switch to using their first names during negotiations. A suit and tie is not required, but the atmosphere at the meeting is serious.
- You can’t do without English In Finland, English is the business language, due to the uniqueness of Finnish, knowledge of the local language is not expected.
- Prepare thoroughly for the meeting Prepare thoroughly for the meeting. Speak clearly, give truthful information backed by facts and figures. At the end of the meeting, clearly present what your goal is.
- Compromise Finns do not seek out conflicts, but if they do arise, they resolve them quickly and through compromise negotiations. A successful deal is considered one where both parties are satisfied.
- You build trust with references References are of significant value, especially from other countries in Scandinavia or Western Europe.
- Innovation opens doors Be innovative. Finland is the country with the most innovation in Europe and the second most developed digital economy in Europe.
- Specialization means greater success The Finnish market is highly concentrated with the presence of global players. When entering the market, it is therefore necessary to specialize closely and focus precisely on the target group for the given product.
- Create a stable partnership The sense of honor and honesty is great in Finland. It is not easy to build a business relationship, but if it is successful, it is a quality and stable partnership.